2024-03-13 14:05:03 ET
Keywords Studios plc (KYYWF)
Q4 2023 Earnings Conference Call
March 13, 2024 05:00 ET
Company Participants
Bertrand Bodson - Chief Executive Officer
Robert Kingston - Chief Financial Officer
Conference Call Participants
Nick Dempsey - Barclays
Sebastian Patulea - Jefferies
Bridie Barrett - Stifel
Jasmine Read - Numis
Rahul Chopra - HSBC
James Lockyer - Peel Hunt
Presentation
Bertrand Bodson
Hi, everyone. Thank you for joining us for our Full Year 203 Results. Great to see many of you in the room. Great to have many of you as well on screen. And particularly, thank you as well to the ones who have been following us for a very long time. I can see many family friends here as well and a warm welcome to the ones who are new to the story.
In terms of agenda, Rob and I have a pretty big agenda today. I’ll start with a quick summary. Rob will come in to share the financial highlights. We will then go in strategy, where I am going to spend a little bit more time on a couple of topics, especially strategic partnerships and how we have been developing relationship more deeply with some of our clients and I’ll go long on some of the tech developments that we have made. We will do a section on M&A. I think it’s an important topic. We’ve had a record year last year. I thought that it was worth showing a little bit more of what is under the hood of it before getting to outlook and then Q&A.
So in terms of 2023, we’ve had strong results in a challenging market. We’ve been extending our market leadership position across the board, across the group. I think it’s probably a year of strong resilience as well showing the diversification of the model, showing the resilience of what we can do, staying very close to our clients, at the same time, making sure that we have the right cost controls in place. It translates in terms of €780 million of revenue for the year, which is 13% growth in AR, 17% growth in terms of CER. We have had 9% organic growth, excluding the strike and FX. Adjusted operating profit came on the high end of the range at €122 million, 15.6% margin as we’re guiding for 15%, and as I just said, a record year in terms of M&A with €225 million of total consideration. I’ll share a little bit more as well about the latest addition to the family called MPG, the Multiplayer Group, very proud to have them on board.
So clearly, there have been some headwinds in the market last year. There still are. I think they are no surprise at all to anyone in the room who follows the industry, but you have seen many of the publishers of our clients who are making sure that they focus on the core IPs where they can really go and win. Lot of those tend to be AAAs when – which s a space where we naturally operate. You have seen as well quite a few of our clients being more cost conscious. So it hasn’t been just growth at all cost. So the cost side has been an important factor in all of this. You have seen a lot of job losses as well in the market, but it’s more publishers restructuring their own model, reshaping their own model, making sure that they fit for purpose for what’s coming ahead. This forced us to play a little bit more tetris to make sure that we can be at the right place next to the right IPs but that’s something that we have the type of agility compared to most competitors to take that on.
And lastly, the strike – yes, the strike was resolved at the end of last year on the entertainment space, but at the same time, it still takes some time and will take some time to ramp up properly throughout H1. This is very natural. This is the machine that is being brought back to full speed and up and running. You get the producers who are getting back in the studios and we are in discussion with many of those. We tend to come on the tail end of that, especially on the dubbing side and on the marketing side, once the productions are getting ready to go on the streaming platforms as such, but with a lot of volume coming on the back of that....
Read the full article on Seeking Alpha
For further details see:
Keywords Studios plc (KYYWF) Q4 2023 Earnings Call Transcript